The UK sources about 60% of its sugar beet from domestic producers.
Photograph: Dan Chung/for the Guardian

The end to almost fifty years of Brussels protectionism this weekend is set to shake up Britain’s sugar industry – with the potential for boom or bust for producers. But there’s a sweetener for consumers, as prices are expected to fall.

The European Union is abolishing its system of quotas and minimum pricing for sugar from Sunday 1 October, in one of the biggest changes for British agriculture in recent years. The UK’s 3,500 growers of sugar beet – a sweet root vegetable that looks like a turnip – and the country’s sole refiner, British Sugar, expect the change to allow them to increase production by 50% annually.

It’s an industry that supports nearly 10,000 jobs across the country, helping the UK to consume roughly 2m tonnes of sugar a year. About 60% comes from home-grown beets, while another 15% comes from the EU and the remainder is from imported cane sugar.

The sugar rush comes as the EU scraps limits on production for the first time since 1968. Britain had been limited to producing little more than one million tonnes a year, which has led to stockpiling following bumper harvests. British Sugar, a part of the Associated British Foods conglomerate, plans to immediately increase production to 1.4m tonnes next year from 900,000 tonnes in 2017.

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Paul Kenward, the company’s managing director, said: “I’m optimistic and our growers are too. In the past you could bang on my door and say you wanted more sugar, but I had to say no even if I could make it. Now that is changing.”

But with the vote to leave the European Union, higher taxes on sugary drinks and a government push to wean consumers off unhealthy treats, the industry may face a sticky future. Producers will also be more exposed to the global sugar price as protections recede.

Gerald Mason, the firm’s senior vice-president, said: “This [end of EU quotas] is a pretty depressing milestone for us. We’re already running at a loss, and these changes will only exacerbate that.”

The makers of the famous Lyle’s Golden Syrup at its factory in east London will continue to face EU tariffs just as the global sugar price dips ahead of the anticipated European boom in beet production. Brexit offers the potential to sidestep the EU tariffs, although it could also lead to other changes that are difficult to forecast.

British beet farmers are eyeing a jump in exports as the World Trade Organisation removes limits on EU sugar in exchange for Brussels dropping its pricing and quota system.

Consumers could benefit from falling prices, although not immediately, according to Callum Macpherson at the City bank Investec. “If prices are passed through to consumers, where you might see a noticeable effect, at some stage, is on the cost of buying a bag of sugar in the supermarket,” he said.

Brussels observers estimate the European beet crop for next year to be at least 16% more substantial than the one being harvested now, although they reckon the most competitive nations are the ones that will have increased capacity most. While the UK is among one of the best in the world, the EU describes the “sugar belt” of Belgium, France, Germany, the Netherlands and Poland as the most competitive.

Patrick Allpress, a farmer who grows sugar beet alongside leeks, onions and wheat over 2,000 acres of land in Chatteris, Cambridgeshire, said British growers may see more competition from continental rivals. “Now the chains are off and the quotas are coming down, any country can do what they want,” he said.

Farmers could find themselves with staff shortages or higher costs as low-skilled European migrant workers leave Britain following the Brexit vote. The industry is thought to need about 90,000 seasonal workers a year by 2021, on top of the more than 250,000 permanent workers – more than three-quarters of whom now come from the EU. However, beet isn’t as hard to pick as some crops and the process has already been heavily automated, which could limit the impact.

British Sugar – which operates four sites across east Anglia and the east Midlands – argues that Britain can export more to the EU and global markets. It estimates that beet yields have improved by more than 25% in the UK in the last 10 years.

Kenward said: “On the risk side, is that my competitors in Europe have been holding back due to volume quotas. But we’ve prepared for it, and can now sell to customers in the UK, EU and around the world.”

Across the EU, sugar production next year is now forecast at 20.1m tonnes, about 20% more than this year’s crop. Imports are expected to fall to 1.5m tonnes, while exports are forecast to double to 2.8m tonnes.

A government spokesperson said: “The removal of EU sugar beet quotas will enable British growers compete on a level playing field with other sugar producers around the world.”